What Happens to Medicaid Benefits When a Disabled Child Shifts from SSI to SSDI Income?

Navigating the intricate landscape of government assistance programs can be daunting, particularly when it concerns the welfare of a disabled child. For many families, Medicaid plays a crucial role in ensuring their child receives essential medical care and support. However, when a disabled child’s income transitions from Supplemental Security Income (SSI) to Social Security Disability Insurance (SSDI), it may trigger alterations in their Medicaid coverage.

Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) are federal programs providing financial assistance to individuals with disabilities. SSI is a needs-based program available to disabled children, adults, and elderly individuals with limited income and resources. In contrast, SSDI is an insurance program offering benefits to disabled individuals who have accumulated sufficient work credits. While SSI automatically qualifies individuals for Medicaid benefits in most states, SSDI eligibility for Medicaid is contingent on factors such as income and resources.

SSDI is tailored for those who become disabled after an extended period of work. To receive SSDI benefits, a beneficiary must have contributed to the Social Security system for at least ten years before their disability onset. However, for adults disabled since childhood, meeting this criterion can be challenging. Some disabled adults may qualify for SSDI based on their parent’s work record through the Disabled Adult Child Program (DAC).

To qualify for DAC, the adult child must:
(1) have a qualifying disability,
(2) be single and not legally married,
(3) have a disability that manifested before turning 22,
(4) have a parent with sufficient work credits for retirement benefits, and
(5) have a parent who is deceased, permanently disabled, or receiving retirement benefits. If the parent retires or becomes disabled, the disabled child receives 50% of the parent’s benefit, and in the event of the parent’s death, the child receives 75%.

Now, what transpires regarding Medicaid eligibility when a disabled adult child transitions from SSI to SSDI benefits? To safeguard Medicaid coverage for specific groups losing SSI payments, Congress established special Medicaid continuation provisions. These provisions mandate state Medicaid agencies to regard certain former SSI beneficiaries as still qualifying for Medicaid, under sections 1634(c) and 1935(a)(2)(D) of the Social Security Act. Those eligible for the DAC program can thus maintain their Medicaid coverage, ensuring continuity as long as they meet the specified criteria.